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HTC posts worst results in 14 years

HTC posts worst results in 14 years

Taipei, Feb. 3 (CNA) Taiwan-based smartphone brand HTC Corp. on Wednesday reported its worst annual results since 2002 when it was listed on the Taiwan Stock Exchange.

At an investor conference, HTC said its annual consolidated sales fell 35.24 percent in 2015 to NT$121.68 billion, while it registered a loss per share of NT$18.78 due to escalating global competition.

In the fourth quarter of 2015, HTC posted a worse-than-expected loss per share of NT$4.1 and a gross margin of 13.9 percent, the lowest quarterly data in its history and its third consecutive quarterly loss.

Its results for the first three quarters of last year were NT$0.43 in earnings per share, NT$9.7 in loss per share, and NT$5.41 in loss, respectively.

The fourth quarter results indicated a quarterly improvement in HTC's bottom line on the back of sales of its mid-range models, such as the HTC Desire series and the HTC One A9, said Chang Chia-lin, the company's chief financial officer and president of global sales.

The full year results, however, were the worst in the 14 years since the company became listed on the Taiwan Stock Exchange.

Chang said HTC has broadened its focus beyond smartphones to virtual reality and the Internet of Things, expecting to find alternative sales sources in 2016 to offset the effects of stiff competition in the global smartphone market.

The HTC Vive, the first VR headset, jointly developed by HTC and U.S. video game supplier Valve, was unveiled at the Mobile World Congress (MWC) show in March 2015.

HTC has invested more than NT$300 million in WEVR, a VR content developer in the United States, to strengthen its VR development. The HTC Vive is scheduled to hit store shelves in April.

HTC Chairwoman Cher Wang said HTC has been exploring the possibility of expanding the VR headset applications to areas such as medical care, education, exhibitions, property development, industrial design, tourism and e-commerce.

The company said its non-smartphone business is expected to start to make sales contribution in the second quarter of this year.

HTC is planning to launch fewer new smartphone models this year, making it easier for consumers to pay attention to its products, a strategy Chang said could lead to profits in the company's smartphone operations this year. Meanwhile, in a statement Wednesday, HTC reported a 47.23 percent year-on-year drop in its consolidated sales for January and a 0.2 percent decline from a month earlier to NT$6.48 billion, its lowest monthly revenue in more than 10 years.

Market analysts said the steep year-on-year fall in January sales was due to a lack of new smartphone models.

HTC said its first-quarter results are likely to be the lowest this year. Shares of HTC fell 2.60 percent to close at NT$75.00 on the local main board Wednesday, when the weighted index ended down 0.84 percent. (By Esme Jiang and Frances Huang)